Published on Feb 21, 2020
KyberNetwork is a new system which allows the exchange and conversion of digital assets. We provide rich payment APIs and a new contract wallet that allow anyone to seamlessly receive payments from any tokens.
KyberNetwork will be the first system that implements several ideal operating properties of an exchange including trustless, decentralized execution, instant trade and high liquidity. Besides serving as an exchange, KyberNetwork also provides payment APIs that will allow Ethereum accounts to easily receive payments from any crypto tokens. As an example, any merchant can now use KyberNetwork APIs to allow users to pay in any crypto tokens, but the merchant will receive payments in Ether (ETH) or other preferred tokens.
Although running on the Ethereum network, KyberNetwork’s roadmap includes supporting cross-chain trades between different cryptocurrencies using relays and future protocols like Polkadot and Cosmos. Ethereum accounts will be able to safely receive payment from Bitcoin, ZCash and other cryptocurrencies via our payment APIs, through this trustless payment service. Derivatives will be introduced to mitigate the exposure to the risk of volatilities for the users of KyberNetwork Crystals (KNC) and selected cryptocurrencies. This will allow users to participate in the price movements synthetically.
KyberNetwork’s design has several novel constructions to support all these applications.
● Instead of maintaining a global order book, we maintain a reserve warehouse which holds an appropriate amount of crypto tokens for purposes of maintaining exchange liquidity. The reserve is directly controlled by the Kyber contract, and the contract has a conversion rate for each exchange pair of tokens by fetching from all the reserves. The rates are frequently updated by the reserve managers, and Kyber contract will select the best rate for the users. When a request to convert from token A to token B arrives, the Kyber contract checks if the correct amount of token A has been credited to the contract, then sends the corresponding amount of token B to the sender’s specified address. The amount of token A, after the fees, is credited to the reserve that provides the token B.
● We introduce a new standard contract wallet to enable some of our interesting applications. Specifically, our new standard contract wallet allows the Kyber contract to send a user’s newly converted tokens to his/ her destination address on the user’s behalf. The destination address will receive the converted tokens as if the tokens were sent from the sender, not the Kyber contract.
● Our long-term plan also includes employing future features of the EVM language to build an efficient ZCash-Relay on Ethereum. A ZCash-Relay on Ethereum will allow us to support cross-chain trades between ETH and ZEC. We also leverage future platforms like Polkadot and Cosmos to enable more cross-chain trading and payments.
● The Kyber contract is designed with extensibility-focus which has well modularized components. Specifically, we allow dynamically adding any new tokens or delisting existing tokens. Thus, we are able to work with any tokens or digital assets in the future
